The Dubai International Financial Centre (DIFC) has taken a step in bridging the climate finance gap, by launching the Sustainable Finance Catalyst initiative, which is targeting a capital flow of $100 billion through Dubai by 2030.
According to Christian Kunz, Chief Strategy, Innovation & Ventures Officer, DIFC, the $100bln target will indicate a 600% rise in capital flow over the next years, recording a significant rise from the $17.1 billion raised between 2018 and 2022.
Facilitating this initiative by DIFC, Ian Johnston, Chief Executive of the Dubai Financial Services Authority (DFSA) also announced the entity was waiving all regulatory fees for issuers wishing to list sustainability-related debt securities in the DIFC throughout 2024. This fee waiver is effective immediately and will apply throughout 2024.
“In order to achieve our global ambitions on climate change, and the sustainable development goals, we believe we need to create a catalyst of change, not only focus on capital, but also on capability. After all, it’s the people that are making the change happen and DIFC and its strategic partners will amplify those to empower our ecosystem,” Kunz said, speaking on the sidelines of COP28, taking place at Expo City Dubai.
Speaking to Media, Kunz acknowledged that challenges in deploying funds and transparency remained key hurdles to overcome, he remained confident that build on current strengths to achieve these ambitious goals was possible through the four pillars the catalyst was resting on – by launching an AI-driven knowledge hub, growing sustainable and Islamic finance, building capacity, and upskilling the talent pool, facilitating faster sustainability-driven innovation.
“DIFC is the number one sustainable and finance hub in the region, with Nasdaq Dubai being the largest sustainable capital market with over $28.8 billion in green sustainable depth rates today,” said Kunz. “It’s the largest sukuk and sustainable sukuk market in the world and we know that we can’t achieve the goal without Islamic funds.”
According to Kunz, the Sustainable Finance Catalyst aims to build on its talent pool by supporting one million future sustainability leaders by providing easy access to curated sustainability training programmes, knowledge and toolkits, networking, and events.
Beyond the Sustainable Finance Catalyst, DIFC has also announced that the Dubai Future District Fund will allocate up to 20% of the AED 1 billion fund to drive growth and back sustainability-driven tech and innovation start-ups and scale-ups, in collaboration with Dubai Future Foundation, in their capacity as founding partners of the fund.
“We need to move to a world where companies don’t have to transition or where they want to transition, their future leaders are equipped with this knowledge. That will boost innovation as the multiplier and facilitate exponential compounding force of positive change. This includes innovation on solutions, financial products, as well as policy,” said Kunz.